By Dave Wilkin, P. Eng., M.Eng. and Tim Lutton, BSc., MBA
It is often said that the definition of insanity is doing the same thing over and over again and expecting different results. This aptly describes the current situation in world energy markets, as global energy demand grows continuously dragging green-house gas (GHG) emissions along, ever since the signing of the 2015 Paris Climate Agreement. Recent re-elections in India and Australia of pro-growth governments over apparent climate-change focused alternatives continues a familiar pattern.
EU elections saw increased division with marked growing resistance to climate-driven initiatives, mostly in Eastern Europe, facing rising Green Parties who press EU members to commit to ‘zero CO2 emissions’ by 2050. In many developed countries leaders push poorly conceived plans and minimalist solutions with the allusion of reaching unrealistic emission-reduction targets. Absent are strategies and actions based on sound engineering, science and economics. But it gets worse in developing countries, where nationalist leaders place economic, political and security priorities above emission-reduction related actions.
A similar situation plays out in Canada now, with the approaching election. Energy systems are extremely complex and deeply rooted. This has motivated us to undertake a multi-part series, that will explore the global energy-ecosystem, digging below the surface to separate fact from fiction, and explore the fundamental drivers that will shape our energy future. We attempt to keep our articles understandable by avoiding overly technical analysis and by referencing our key information sources. We will also avoid discussions about climate-science, as it’s not our area of expertise.
Below is a quick preview of our series:
- With an 85 per cent share of the energy market, carbon-based energy dominates today’s global energy supply.It’s important to understand the energy big picture, including energy mix, carbon energy reserves.
- Global population and economic growth, led by developing countries (home to 80+ per cent of the world’s population) consistently overwhelms new energy technology and efficiency improvements, driving up carbon-based energy demand and with it, carbon emissions.
- The Geopolitics of energy shapes country policies and strategic choices. Affordable carbon based energy forms an economic foundation, so running out of it or closing it down before economically viable/scalable alternatives are widely available must not happen.
- Technology shapes the future; however, the new technologies are expensive, so replacing the existing system will be very costly, likely in the $100 trillion range globally. That, along with the limitations and constraints, ensures no single replacement technology for carbon energy exists. There is no silver- bullet solution.
- Our worst-case scenario connects the four big factors driving the global energy-ecosystem: growth, reserves, new technology, and geopolitics, showing how it could all go badly without thoughtful investments now.
- Finally, some recommendations that should be in Canada’s future energy roadmap, and a high level scoring of political parties against them.
Energy transition must happen well before the world’s affordable oil and gas reserves run short. Everyone should be able to agree on this. We are in the early stages of a global energy system transition. It’s enormously complex, carrying the highest possible stakes. It must not happen chaotically. Betting the farm on any single energy source or technology would be unwise, as many forms of energy will be required to meet the world’s growing energy demands.
Blessed with abundant energy resources and a modern democratic economy, Canada is ideally positioned to navigate and lead through the transition. Sadly, current political leadership has fallen short, and we continue to waste time and valuable resources. The time for sound strategy, realistic and achievable plans and actions has come; the time of siloed thinking, minimalist plans and political spin is over.
We hope you find our mini-series enlightening, informative and helpful. Watch for our next article, The Energy Big Picture, coming soon!
Dave Wilkin is a Professional Engineer who lives in Huntsville. He is an electrical engineer with a career spanning 35 years in IT, banking and consulting.
Tim Lutton worked in the natural gas and LNG industry for 32 years; with Imperial Oil in Canada, and ExxonMobil in the USA, Australia and Qatar and now lives in Huntsville.
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